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192245
Fri, 07/01/2011 - 12:21
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https://oananews.org//node/192245
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Samsung merges chip, LCD divisions on weak display biz
(ATTN: RECASTS headlines; ADDS more context, quotes, share price; RESTRUCTURES, TRIMS)
By Lee Youkyung
SEOUL, July 1 (Yonhap) -- Samsung Electronics Co., the world's top maker of memory chips and liquid crystal display (LCD) panels, said Friday that it created an umbrella division to oversee its semiconductor and LCD panel businesses and appointed its semiconductor chief to lead both.
Kwon Oh-hyun, president of Samsung's semiconductor business, has taken on a wider role as chief of digital solutions, overseeing Samsung's memory chips, system LSI and LCD panel sectors, according to the company's statement. The appointment took effect as of Friday.
Chang Won-kie will leave his position as president of the LCD division and aid chief executive officer and vice chairman Choi Gee-sung on chip and panel facilities, Samsung said.
The decision brings back the two component divisions under a single leadership since they were separated to run like independent companies in 2004.
Struggling with weak TV demand, the low profitability of a new production process and stiff competition from its rival LG Display Co., Samsung's LCD division posted an operating loss of 230 billion won (US$216 million) in the January-March period.
The display panel business is forecast to post an operating loss of about 230 billion won in the second quarter, Woori & Securities Co.'s analyst Park Young-joo said in a report.
"Chang was held responsible for the poor earnings but he will maintain his president title," Rhee In-yong, a senior vice president and chief spokesman of Samsung group, told reporters in a briefing.
"The combination is also aimed at raising the synergy between semiconductor and LCD and to tide over the crisis in the LCD business," Rhee added.
In the statement, Samsung said that it created a new structure to facilitate collaboration between the semiconductor and LCD panel businesses.
The move will also reinforce the independence of its components business from Samsung's TV, mobile phone, PC and home appliance businesses, it added.
"The changes will also help Samsung???s component businesses further strengthen their independence and improve relationships with their global clients," Samsung said in the statement.
Samsung, the world's second-biggest mobile phone maker, competes with Apple Inc. in the smartphone and tablet markets. Their rivalry escalated this year with patent lawsuits and countersuits in at least four countries.
But the Korean tech giant also counts Apple as the biggest buyer of its semiconductor products.
Analysts said that the combination will allow the semiconductor business to offset display losses and accelerate decision-making.
"The two divisions share a lot of the same customer base," said Seo Won-suk, an analyst at NH Investment & Securities Co. "There will be more gains than being separated."
An executive reshuffle in the middle of the year is seen as unusual for the South Korean company, which usually conducts annual reshuffles at the end or beginning of each year.
As part of the reshuffle, Shin Jong-kyun, president of Samsung's mobile business, will assume an additional role of overseeing the company's digital camera business, it added.
Earlier in the day, Choi Gee-sung, Samsung's vice chairman, said in a note to his employees that Samsung faces a "still uncertain" economic outlook for the rest of the year and 2012.
"We need to revamp our internal process and need to introduce products that go beyond customers' expectations to create profits," he said.
Shares of Samsung closed at 855,000 won on the Seoul bourse, up 3.51 percent from the previous session.
By Lee Youkyung
SEOUL, July 1 (Yonhap) -- Samsung Electronics Co., the world's top maker of memory chips and liquid crystal display (LCD) panels, said Friday that it created an umbrella division to oversee its semiconductor and LCD panel businesses and appointed its semiconductor chief to lead both.
Kwon Oh-hyun, president of Samsung's semiconductor business, has taken on a wider role as chief of digital solutions, overseeing Samsung's memory chips, system LSI and LCD panel sectors, according to the company's statement. The appointment took effect as of Friday.
Chang Won-kie will leave his position as president of the LCD division and aid chief executive officer and vice chairman Choi Gee-sung on chip and panel facilities, Samsung said.
The decision brings back the two component divisions under a single leadership since they were separated to run like independent companies in 2004.
Struggling with weak TV demand, the low profitability of a new production process and stiff competition from its rival LG Display Co., Samsung's LCD division posted an operating loss of 230 billion won (US$216 million) in the January-March period.
The display panel business is forecast to post an operating loss of about 230 billion won in the second quarter, Woori & Securities Co.'s analyst Park Young-joo said in a report.
"Chang was held responsible for the poor earnings but he will maintain his president title," Rhee In-yong, a senior vice president and chief spokesman of Samsung group, told reporters in a briefing.
"The combination is also aimed at raising the synergy between semiconductor and LCD and to tide over the crisis in the LCD business," Rhee added.
In the statement, Samsung said that it created a new structure to facilitate collaboration between the semiconductor and LCD panel businesses.
The move will also reinforce the independence of its components business from Samsung's TV, mobile phone, PC and home appliance businesses, it added.
"The changes will also help Samsung???s component businesses further strengthen their independence and improve relationships with their global clients," Samsung said in the statement.
Samsung, the world's second-biggest mobile phone maker, competes with Apple Inc. in the smartphone and tablet markets. Their rivalry escalated this year with patent lawsuits and countersuits in at least four countries.
But the Korean tech giant also counts Apple as the biggest buyer of its semiconductor products.
Analysts said that the combination will allow the semiconductor business to offset display losses and accelerate decision-making.
"The two divisions share a lot of the same customer base," said Seo Won-suk, an analyst at NH Investment & Securities Co. "There will be more gains than being separated."
An executive reshuffle in the middle of the year is seen as unusual for the South Korean company, which usually conducts annual reshuffles at the end or beginning of each year.
As part of the reshuffle, Shin Jong-kyun, president of Samsung's mobile business, will assume an additional role of overseeing the company's digital camera business, it added.
Earlier in the day, Choi Gee-sung, Samsung's vice chairman, said in a note to his employees that Samsung faces a "still uncertain" economic outlook for the rest of the year and 2012.
"We need to revamp our internal process and need to introduce products that go beyond customers' expectations to create profits," he said.
Shares of Samsung closed at 855,000 won on the Seoul bourse, up 3.51 percent from the previous session.
